Raising awareness with energy management

Ryan Whisnant is the director of sustainability at SunGard, a software and technology services company with over 250 offices in 35 countries and 20,000 employees worldwide. Prior to joining SunGard, he founded a consulting practice that provided strategy, program management, and communications services to technology clients. His experience includes program development and training for an energy systems provider, environmental nonprofit strategy, and consulting on various sustainability and technology projects. Whisnant holds a bachelor’s degree in environmental engineering from Northwestern University, an MBA from the Ross School of Business, and a master’s degree from the School of Natural Resources and Environment at the University of Michigan.

In this interview, Whisnant details SunGard’s experience of using an energy management system as part of broader sustainability efforts.

Ryan Whisnant of SunGard details the company’s journey to get a handle on energy management in its operations.

Interview conducted by Vinod Baya and Bo Parker

PwC: What does sustainability mean in your business?

RW: At SunGard, our employees have had a long-standing, grassroots interest in sustainability. We made a formal, public commitment in 2008. Sustainability is driven by values. For us it is about improving our competitiveness, reducing our risks, and being a responsible corporate citizen. Given the nature of our business—we’re a technology business—we obviously have a strong focus on environmental sustainability, and our most important and challenging sustainability issue is around energy use in our business. But sustainability encompasses broader things—all the environmental, social, and governance factors.

PwC: What solutions or tools do you use to help with your sustainability initiatives?

RW: We’ve evolved, like many other companies. At first it was more of a manual process, putting together data and spreadsheets. Then we moved through some different tools, most recently to Hara for tracking and management of our energy use. For us that’s important, because if you look at the profile of our business in terms of our emissions, it’s pretty much all scope 2 emissions from purchased electricity. We’re not the kind of business that has significant scope 1 emissions. We do, of course, have some scope 3 emissions with business travel. But it’s really that purchased electricity. So, being able to track the energy use in our facilities is critical to managing and reducing our environmental footprint. The tool is also important for our ability to be transparent and report on our carbon footprint.

PwC: What are some of the challenges that you’ve needed to overcome?

RW: Data is one of the biggest challenges in terms of getting a system in place. Using an energy management system has been very helpful. But there’s a lot of work on the back end that must occur to even have the data available to pull into the system. Much of that has to do with the business process. You can’t just come online with a platform like this and expect it to be a silver bullet for reporting carbon emissions. You really must change some of your processes.

PwC: As you move forward with sustainability, are there impacts that you did not anticipate?

RW: Part of the value of sustainability is the process that you go through in implementing an enterprisewide management system. It’s the conversations that you have internally, where you’re realigning processes. For us, we could highlight—with different stakeholders within the company— the importance of tracking our energy usage and having an understanding of our carbon emissions. In places such as the UK, where they have the Carbon Reduction Commitment [CRC], if you’re a certain type of organization and you use a certain amount of electricity, you essentially pay for your emissions. There’s a direct cost not only for the electricity that you’re using but also for the emissions.

It’s important to be able to raise that as a material issue within the organization. Going through the process of changing the internal business process to pull together this data for these kinds of systems has been very valuable.

It’s the same thing when you’re developing and reporting and really working on being transparent according to a standard such as GRI [Global Reporting Initiative]. A whole internal conversation occurs around all the indicators. It raises awareness and forces companies to take a look at how they’re performing in these different areas.

PwC: As you pulled together the data, what were the insights you gained that you probably didn’t know before?

"Sustainability is driven by values. For us it is about improving our competitiveness, reducing our risks, and being a responsible corporate citizen.”

RW: It’s sort of an 80/20 rule in this case. The first time, you slice and dice the data and see where some of the biggest insights come from. When we took our first pass at this, it was interesting to find that the majority of our energy use, about 85 percent, comes from our data centers. Every company has limited resources and limited time, so you need to know where to focus your efforts. For us, it became clear that we needed to focus on being efficient in our data centers—obviously not to the exclusion of working on the energy efficiency of our offices, but I think that was a real eye-opener. We had a hunch that the data centers were using more, but I don’t think we knew that it would be quite to that degree.

And then after you evolve a little bit more on that process, the insight becomes more granular. Now we’re down to the level where we’re able to look at individual facilities. We can actually look at our energy intensity (kilowatt-hours per square foot) on an annual basis, and we can get a good sense as a normalizing factor what the facilities look like and how they’re comparing to other facilities. We have a diverse real-estate footprint. We’re in 30 countries and in most cases it’s leased space, so you can have buildings that look dramatically different. In some of them, like the office where I am in New York, we built it out from scratch with sustainability and energy efficiency in mind. We’ve been in some other facilities a little bit longer, so they’re less efficient. Being able to get down to a level of granularity allows us to identify those locations where we can focus our efforts on energy efficiency and retrofit.

PwC: Are these insights providing a greater appreciation for the inherent risks, and is business planning and modeling any different because of that?

RW: Yes. It gets back to the comment I made about raising the awareness within the organization. Before, energy usage may have been just another line item. Now there are all these other considerations around it. Especially because we’re a technology business and what we do relies on access to affordable and reliable energy, highlighting the potential risks around any kind of energy price volatility is necessary to understand risk.

Also, there’s so much uncertainty around carbon regulation. There’s the CRC in the UK. They’ve looked at a carbon tax in France. Things have come up in Australia and Japan, and there are activities in the US as well. Being able to have some sense for what our carbon profile looks like in different parts of the world—that’s important to build into the risk equation.

PwC: What are some open challenges to address in the future?

RW: A topic on the horizon and one we want to be prepared for is integrated reporting. Stakeholders are looking to ultimately have an integrated report that ties together the financial reporting and the sustainability reporting. With that reporting, you’re able to convey the business value of sustainability or corporate responsibility indicators in terms that all understand. A lot of good work is being done in integrated reporting.

The biggest challenge to doing integrated reporting right now is that there isn’t really a standard. We have good, solid standards for financial reporting, and something similar is needed for sustainability reporting. Standards like GRI are emerging, which is very important. We have chosen to use GRI to report our performance in a standard way. It’d be interesting to see what GRI grows into in the future.

PwC: How has implementing sustainability solutions affected the organization?

RW: We’re at a stage where we’re continuing to develop our ability to measure and monitor our energy use. Some of our employees have the ability to see the energy usage in their location. One of the things we’ve found—it’s not unique to us—is that competition amongst employees can be a great tool in terms of driving organizational change and just having that awareness. One of the reasons we looked at Hara as a tool was the potential to pull the data into our intranet where we could create a dashboard where employees see the energy usage at their various locations, so they can start to play an active role.

The question I get more than any other from our employees is, “What can I do related to sustainability that will have an impact on the company?” We have a good level of awareness, and introducing granular information in the context of business activities is a way to take it to that next step, where employees can start to play a role in reducing our energy use. I’ve heard of studies saying the behavioral component accounts for between 3 percent and 5 percent of energy use at a location. So it’s not an insignificant amount.

PwC: What advances would you like to see, so that you can continue to move forward with your sustainability goals?

“We have a good level of awareness, and introducing granular information in the context of business activities is a way to take it to that next step, where employees can start to play a role in reducing our energy use.”

RW: The more that we can move toward automation, the more benefit that companies will realize. We’ve gone through a learning process, and I’m sure other companies have had the same experience. We started from a manual process, going out to all the facilities and manually trying to gather that energy data. As much as you can, you want to remove that manual portion of the process and just have the energy data feed directly into the system. Today we use a service that aggregates the bills for us, and there are some other side benefits to that where the service helps us look for competitive pricing contracts in terms of energy. The service looks for billing errors and things like that, aggregates the data, and then uploads all of the kilowatt hours and cost into a system.

We can then feed that into our management system and get the combined view in terms of our scope 2 emissions (from purchased electricity) and scope 3 emissions (from business travel). I think it’s leaps and bounds ahead of doing it manually. Ideally things would evolve to the extent where maybe you just have a web service that is getting the energy data directly from a submeter at the location or it’s getting it directly from the utility in lieu of a paper bill. The more things can get automated like that, the better. You see that in other areas of business, and I would anticipate that we’re going to see more and more moves in that direction.